intel.jpg Ultrabooks too expensive according to Taiwan notebook makers

Apple's recently launched MacBook Air starts at US$999 and the Taiwanese notebook makers are very concerned about Apple's pricing and claim that unless Intel lowers its CPU prices for its ULV models, Ultrabooks will end up way past Intel's suggested US$1,000 starting price point. We're having a feeling of déjà vu here with the failed CULV platform which wasn't quite as big as a failure as it's been made up to be, but it was another platform that was simply too expensive.

Apple's recently launched MacBook Air starts at US$999 and the Taiwanese notebook makers are very concerned about Apple's pricing and claim that unless Intel lowers its CPU prices for its ULV models, Ultrabooks will end up way past Intel's suggested US$1,000 starting price point. We're having a feeling of déjà vu here with the failed CULV platform which wasn't quite as big as a failure as it's been made up to be, but it was another platform that was simply too expensive.

It's easy to point fingers at Apple, but in this case we can't but wonder if some of the notebook manufacturers have over-reached in terms of what they thought they could produce at a certain price point. The notebook makers are now putting pressure on Intel to lower its CPU prices for them to be able to hit the target pricing for Ultrabooks.

Part of the problem is said to be changes in the production process as most, if not all components will be soldered onto the main PCB of the Ultrabooks to help reduce weight and thickness. SSDs are also required to meet the slim profile alongside li-polymer batteries and several other changes. Even so, Intel's CPUs are said to bear about one third of the total cost of an Ultrabook, which sounds a bit steep.

Intel has a fairly limited range of ULV processors, but even so Intel's ULV Core i5 models have a list price of US$250 which is only a quarter of the US$1,000 price point. In all fairness Intel is hoping to get machines in the market for less than this, but there's the OEM Core i3-2357M which we sadly don't know what Intel is charging for, but it'll be substantially less than US$250 and if we'd make an educated guess this CPU should end up somewhere around the US$200 mark. Intel also has a couple of budget friendly dual core ULV Celeron models at US$134 and although they're not very attractive in terms of performance, the cost is comparatively low.

The question is if the notebook makers are willing to make this kind of a trade-off, especially after the low-end CULV notebooks failing to gather any kind of momentum and in the end even the high-end models ended up being sold at close to cost. A repeat of this situation would be a disaster for the notebook makers and this seems to be the main reason why they're being so cautious about the Ultrabook market segment. That said, some innovation would go a long way to convince consumers to go for an Ultrabook over a regular notebook, despite the slightly higher price. We have a feeling that one reason why Apple's 13.3-inch MacBook Air is so popular is because of the higher resolution screen, an option that's rare to see on Windows notebooks and it's not exactly a super innovative feature.

Source: Digitimes